Is your company stuck in the Marketing Qualified Lead (MQL) trap? Do you spend a lot of time capturing and filtering large numbers of poor-quality leads? Well you are not alone.
This blog post is an extract from a brilliant episode on the ROI of marketing with Chris Walker, CEO, Refine Labs on The ABM Conversations Podcast.
The key theme covered in that podcast episode and the synopsis captured here is, the answer to the question âWhat needs to happen in order to create marketing leverage?â
In fact, in several organizations, we have seen that you are a super star if you are able to get more than 1000 leads a month, regardless of not even one lead converting into a customer.
Bad leads. Leads for the sake of hitting quota. This is one of the biggest reasons for sales and marketing misalignment.
Why would a sales rep or an account executive want to spend his or her energy on a lead that has no buying intent?
And thus, over time they stop trusting the leads coming in from marketing campaigns.
On the other hand, the marketers begin to think – âWe gave them 5000 leads and the sales team has discarded all of them. They are not even reaching out to these leads!!â
This is how a typical conversation looks like:
The point is âif you donât change your demand gen metrics, you will forever be stuck on the performance marketing lead gen hamster wheel.
So, without further ado, here are my 10 BIG takeaways from Yaag and Manishâs conversation with Chris
The typical MQL trap
1. The old MQL game
If you want to produce diminishing returns and keep your company stuck in the MQL trap, do these five things.
A. Generate as many âleadsâ as possible.
B. Measure success based on âCost Per Leadâ.
C. Let your SDRâs Filter.
D. Convert at less than .1%.
E. Create a low average LTV.
âIf your SDRâs are calling 1,000 people, and 999 are not going to buy, thatâs a BIG PROBLEM.â â Chris Walker
2. The New Game
If you want to create marketing leverage and get your company out of the MQL trap, do these five things.
A. Generate only âQuality ICP Leadsâ. (Get way fewer leads)
B. Measure success based on revenue results.
C. Send inbound qualified opportunities directly to your AEâs.
D. Convert at a much higher percentage.
E. Create a high average LTV.
3. The Lead
The way that you define a âLeadâ will greatly influence your results. Thatâs why Chris chooses to define a âLeadâ as someone within your ICP, who comes to you on their own and says:
âIâd like to talk to your sales rep about a product.â
Why?… Because it indicates a higher level of buying intent and a higher LTV potential. But unfortunately, too many companies are defining a âLeadâ as: âAnyone who gives us an email address for our e-bookâ
4. Measurement & Attribution
âMarketers tend to do the things that they can measure, not the things that are most effective.â â Chris Walker
Be careful what you measure, and be even more care what you give credit to.
Was it only paid search that created the conversion and the revenue?… Or do you think that the other 40 âtouchesâ on Linked-in and Facebook had anything to do with it?…
Too many companies get caught pouring their budgets into Google AdWords because itâs the last touch point. But these companies end up destroying their leverage.
Please donât be one of them.
5. Performance & Brand
âSeparate your marketing into performance and brand.â
Thereâs a time for direct ROI attribution, and itâs when youâre doing a performance marketing campaign. The problem is that most companies place 100% of their budget into performance marketing, when itâs actually brand marketing that generates demand sustainably.
Brand marketing is the act of sharing value without any direct attribution. This means that you are completely focused on creating value for the buyer, as opposed to generating leads or conversions.
âI spend no time thinking about selling. It really never crosses my mind.â
âThe point of content is for people to consume it, not for you to collect email addresses.â
6. Channels
Every channel has a different user intent, so craft your message and distribute your content accordingly.
For example:
Chris drives traffic from Facebook to non-gated content outside the platform, but on LinkedIn he keeps everything in the feed.
Being contextual also means measuring channel results based on the purpose of the channel. Donât measure the short-term ROI of a brand awareness channel because thatâs not what itâs for.
For example, LinkedIn is a brand awareness channel, so Chris doesnât measure the ROI of a single piece of content.
The goal isnât to get someoneâs email address.
The goal is to give that person as much value as possible, so that when it comes time to buy, they know exactly who to come to. When it comes to brand awareness, create value for the buyer at the lowest possible friction.
âKarma will play itself out.â
Passing the MQL baton
Having covered everything from the old process to how it actually needs to work, to defining a lead clearly, setting up the process and measuring outcomes, the real key is to know when to pass on the baton from marketing to sales.
Think of it as a relay in the Olympics. In a relay, everyone in the team has to be on top of their game for you to win. While some of them make up for others with their individual abilities, that cannot be the norm. Every individual needs to give the next person something to play with (meaning, a lead over the competition)
Perfecting the baton handoff needs great timing, trust in each other and clear communication.
It is exactly the same story when it comes to passing the MQL from marketing to sales. However, in this case, the adjustment is not just about when to pass the lead to sales, but also to whom.
For example, in most companies, the SDR is only given the role of BANT qualifying the leads. They are not allowed to do demos and AEs are expected to take over for the demo part and take it up to sales closure from there. But what if the incoming prospect knows how the product solves their problem and just wants to see a demo.
It would mean the relaying of every lead to an SDR isnât the right way to go.
7. SDR and AE
âYou canât build a relationship with someone that youâre not going to finish the process with.â
The SDR:
A. Give your SDRâs the freedom from:
- Filtering large numbers of poor-quality leads
- Qualifying prospects that asked for a Demo
B. Give your SDRâs the freedom to:
- Create Content
- Do Customer Research
- Do Strategic outbound
- Engage with comments
- Have genuine conversations within your ICP
The AE:
People with buying intent go directly to the AE, because they asked for a demo. They did not ask to get qualified by an SDR.
C. Give your AEâs the freedom from:
- Running Demos to people who are unlikely to spend money.
D. Give your AEâs the freedom to:
- Run Demos for all of your high quality ICP leads.
- Build a genuine relationship with these prospect that increases LTV potential.
- Handle that process from start to finish.
8. Alignment
Alignment is simpler than you might think. If you fix the metric and the performance incentive, the behavior changes itself.
First, fix the metric.
Stop focusing on âVolumeâ of MQLs and start focusing on âQualityâ ICP MQLs. Quality ICP leads end up converting, staying, and paying.
Next, fix the incentive.
Is your team being rewarded for attracting and converting âQuality ICP Leadsâ?… Or are they being rewarded for meeting their âMQLâ quota?…
âOur system sucks, but I canât change it. Iâll get fired if I donât hit my MQL quota.â â CMO at Company X
If this sounds familiar to you, then your company is probably stuck in the MQL trap.
9. Diversity of Perspective
Cross industry collaboration will create breakthroughs for your company.
Many organizations have become homogeneous, and lack diversity of perspective. This causes inflexibility and thus an inability to change the growth model. Eventually this lack of perspective becomes a major liability.
If everyone comes from the same background, your company will most likely fall into this trap. The key is to team up with people that have highly relevant experience, but that also have perspectives from other industries.
10. Research
Understanding your customer is the most important part of marketing, yet so many marketers are missing experience on the customer-success side of things.
Have conversations with your Clients and within your ICP.
Talk directly to your buyer as opposed to getting all of your information from the sales team. (Second Degree Info)
Always remember that EVERYONE is selling, but very few are thinking like their buyer.
If you got value out of this blog, then I recommend listening to the full ABM Conversations Podcast Episode with Chris Walker.
So many Gems.
Cheers!
